TPL

Texas Pacific Land ($TPL) Insiders' Unprecedented 11-Month Daily Buying Spree Captures Wall Street's Attention

06/03/2025 16:21

Insiders at Texas Pacific Land ($TPL) have been conducting an unprecedented pattern of near-daily stock purchases over the past 11 months, drawing significant attention from Wall Street. The large-cap energy company, with a market capitalization of $29 billion, has seen its stock price rise from $585 in June 2024 to around $1,110 as of June 2025, though experiencing extreme volatility along the way. Most notable is the buying behavior of company director Murray Stahl, who has been purchasing 10-12 shares almost every trading day from August 2024 through June 2025. His total purchases amount to several million dollars, with a significant portion executed under a 10b5-1 plan adopted on November 21, 2024. This demonstrates a strong commitment to buy regardless of stock price fluctuations according to a predetermined schedule. Horizon Kinetics Asset Management LLC, a major shareholder holding approximately 16% of TPL, has similarly maintained nearly daily purchases of 1-3 shares since June 2024. This consistent buying pattern from one of the largest shareholders indicates long-term conviction in the company's prospects. However, some executive selling has also occurred. CFO Chris Steddum sold 750 shares for approximately $970,000 in March, while CAO Stephanie Buffington disposed of 210 shares for about $290,000 in November. Nevertheless, these sales are relatively modest compared to the overall insider buying volume. TPL operates a unique royalty-based business model in the Permian Basin, America's largest oil-producing region. The company holds oil and gas royalty interests across approximately 207,000 acres and is expanding its water services business. Recent Q1 results showed revenue increased 13% year-over-year to approximately $196 million, with earnings per share rising from $4.97 to $5.25. Market conditions have been challenging. The U.S. energy sector experienced volatility in the first half of this year due to supply increase concerns, economic uncertainty, and Trump administration tariff policies. TPL faced particular pressure in May when it missed first-quarter core profit estimates. Despite market headwinds, TPL's financial health remains exceptional. The company carries zero debt, holds $460 million in cash, and boasts a return on equity of 39.52%. It pays a quarterly dividend of $1.60 per share (annualized $6.40) with a payout ratio of approximately 27.7%. TPL joined the S&P 500 index in November but fell 4.6% on its first day of trading, demonstrating the volatility typical of large-cap stocks. The company currently trades at a P/E ratio of 56.62x and forward P/E of 37.74x, representing premium valuations compared to typical oil and gas companies. Energy sector analysts are focusing on TPL's distinctive business model. The company can generate stable cash flows through royalty income without direct drilling operational risks while benefiting from increased production in the Permian Basin. The sustained insider buying suggests strong confidence in the company's growth prospects over the next 6-12 months. Expansion of water services operations and additional infrastructure development opportunities in the Permian Basin are expected to serve as key growth drivers. Investors view TPL as maintaining long-term investment value based on consistent insider buying behavior and solid financial structure, despite high valuations.

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